An Empirical Study for Real Options of Water Management in the Three Gorges Reservoir Area

This paper investigates an empirical evaluation of water management on agricultural irrigation. To address this problem, a real options model was proposed. This model analysis the choice of investment in water savings. Also, the model discusses a linear complementary problem that can be transformed...

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Bibliographic Details
Published in:Sustainability 2021-10, Vol.13 (20), p.11255
Main Authors: Lu, Zuliang, Wu, Xiankui, Cai, Fei, Huang, Fei
Format: Article
Language:English
Subjects:
Accounting
Agriculture
Canyons
Decision making
Inequalities
Irrigation
Irrigation water
Reservoirs
Sustainability
Theoretical analysis
Water conservation
Water management
Water shortages
Water supply
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Summary:This paper investigates an empirical evaluation of water management on agricultural irrigation. To address this problem, a real options model was proposed. This model analysis the choice of investment in water savings. Also, the model discusses a linear complementary problem that can be transformed into the inequalities of parabolic variational. By using a power penalty method, we solved the parabolic variational inequalities. The results depicted that the nonlinear parabolic equations’ solution is converges to the rate of order O(h−k2). A numerical example is given at the end of the paper to demonstrate the theoretical analysis follows from the Three Gorges Reservoir Area.
ISSN:2071-1050
2071-1050
DOI:10.3390/su132011255